NEW YORK – The National Federation of Community DevelopmentCredit Unions and four community development CUs are among the 20financial institutions and organizations that have put theirsupport behind an initiative launched this month by the New YorkCity Department of Consumer Affairs and New York State Departmentof Banking to encourage New Yorkers who have no relationship with afinancial institution to open basic savings accounts as the firststep toward achieving financial independence and stability. NewYork State law requires all commercial banks, savings banks andcredit unions to offer consumers low-fee basic banking services,but according to New York State Department of Banking estimates,800,000 adult New Yorkers lack basic services from a credit unionor bank. The “Bank on New York” campaign, says a Department ofConsumer Affairs spokesperson, is “an unprecedented initiativewhereby credit unions and banks agree to promote during the monthof January low fee banking services” that will allow theseconsumers to use direct deposit and save money on dailytransactions by avoiding more expensive options. NFCDCU ExecutiveDirector Cliff Rosenthal said the campaign grows out of the workthe city of New York has been doing the last couple of years on theEarned Income Tax Credit (EITC), a refundable federal income taxcredit for low-income working families and individuals. He saidhe's been very impressed with the “dimensions of the city'sefforts” to make sure low-income consumers have access to federalrebates on their taxes. In 2003, the Internal Revenue Service saysmore than 21 million taxpayers collected more than $36 billion inEITC payments. “To me the Bank on New York campaign represents anext stage in their efforts. EITC is a great way to help low incomepeople get tax refunds and it's a boost for them, but without anaccount at a financial they're still at a disadvantage. By workingthrough the network of financial institutions in the city, theDepartment of Consumer Affairs is helping people with the nextstep.” For the month of January, through the Bank on New Yorkcampaign, credit unions and banks throughout New York City will usetargeted advertising and consumer education in English, Spanish andChinese to promote low or no fee savings accounts and distributeinformation about EITC. In addition to the advertisements beingdisplayed at the financial institutions, they're also being placedon bus shelters and in newspapers citywide. The ad shows a pictureof a large jar filled with small change. The copy reads: “If thisis your idea of a bank account, stop fooling yourself.Open a RealAccount Today! Opening an account at your local bank or creditunion is easy and will save you money that you now pay to cashchecks and get money orders. At tax time, you can have your refunddirectly deposited quickly and avoid high interest loans from taxpreparers.” Several credit union and bank representatives joinedDepartment of Consumer Affairs Commissioner Gretchen Dykstra andNew York State Superintendent of Banking Diana Taylor for thecampaign announcement on Jan. 6. Meagan van Harte, director ofdevelopment services, Lower East Side Peoples FCU was one of theattendees who also spoke at the launching event. She said theDepartment of Consumer Affairs is aware of the work CDCUs in NewYork City have done with low-income individuals “and they know thisinitiative is targeted at those consumers. That's why we felt itwas important the Department invited credit unions andorganizations that represent credit unions to participate in thecampaign.” According to van Harte, Lower East Side Peoples FCU isone of the largest small groups that offers tax preparationservices. It completed 1,600 filings in 2004 for the 2003 taxseason, and it expects to do more than 2,000 filings for the 2004tax season. The credit union has four sites it does tax filings outof – one at its main branch, one at the Grant Street SettlementHouse, and two in conjunction with the New York City HousingAuthority. “While we talk with people about taxes, we tell them wealso offer them the ability to open a share draft account with usso they can have their refund directly deposited into their creditunion share draft account,” says van Harte. “That way they can havedirect access to the money as cash.” This year will be the thirdyear Lower East Side People FCU has been doing tax filings. Thefirst year it opened 80 accounts, and last year it opened 100 sharedraft accounts. “New York City has a high immigrant populationwhich has had vastly different experiences with banks thanAmericans have had, and they don't always understand credit unionseither. They need to understand there are different types offinancial institutions, they need to understand all their options,”says van Harte. Other New York credit unions participating in Bankon New York include Bushwick Cooperative FCU, Montauk CU, and UnionSettlement FCU. Speaking at the ceremony marking the launch of thecampaign, Commissioner Dykstra said “Bank on New York is atremendous opportunity to reach hundreds of thousands of NewYorkers who may not know that using a bank account is cheaper thanusing instant tax loans or money orders. Together with the BankingDepartment and the City's banking community, we urge consumers,especially those filing for the EITC, to steer clear of high-pricedschemes such as refund anticipation loans that most appeal to thoserelying on getting tax refunds quickly.” New York State CreditUnion League President/CEO William Mellin expressed his support ofthe Bank on New York initiative. “The New York State Credit UnionLeague (NYSCUL) supports this program and looks forward to workingwith the Department of Consumer Affairs and the State BankingDepartment towards its success,” said Mellin. “Credit unionsalready have a driving desire to serve the underserved. The `Bankon New York' program dovetails perfectly with that desire to grantgreater access to low-cost financial services in underservedcommunities as well as help the `unbanked' retain relationshipswith financial institutions.” -

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